An Analyst Conducts a Hypothesis Test to Check Whether the Mean

Multiple Choice

An analyst conducts a hypothesis test to check whether the mean return for a particular fund differs from 10%.He assumes that returns are normally distributed and sets up the following competing hypotheses: H_o:μ = 10,H_A:μ ≠ 10 Over the past 10 years the fund has had an average annual return of 13.4% with a standard deviation of 2.6%.The value of the test statistic is 4.14 and the critical values at the 5% significance level are−2.262 and 2.262.The correct decision is to ____________________________________.

A) reject H_o;we can conclude that the mean differs from 10%
B) reject H_o;we cannot conclude that the mean differs from 10%
C) not reject H_o;we can conclude that the mean differs from 10%
D) not reject H_o;we cannot conclude that the mean differs from 10%